The Department of Revenue Investigation (DRI) on Friday filed cases in Kathmandu district court, against Padam Bahadur Raut and Narayan Poudel of New Dahal Enterprise in the multi-million dollar capital flight scam.
DRI is pressing charges for misappropriating foreign exchange worth US$ 33.46 million (Rs. 2.48 billion) and has demanded fines three times the value of misappropriation as per the Foreign Exchange Regulation Act. The Act also has provisions for imprisonment if the amount exceeds Rs. 10 million.
“We have asked the court to impose this additional punishment,” said DRI Director General Mahesh Dahal. Investigations show that the firm transferred US$ 15.64 million through Himalayan Bank Limited (HBL) and US$ 17.81 million through Nepal Investment Bank Limited (NIBL) to Hong Kong-based banks on the excuse of importing wool and other goods from China by abusing the provision of credit import facility though New Dahal Enterprise did not import any goods through Tatopani customs.
DRI arrested Poudel, who works at the firm, but its proprietor Raut is still at large. DRI has frozen both Poudel’s and Raut’s bank accounts and fixed assets.
DRI is also investigating New Tina Enterprise, another firm involved in capital flight. Investigation showed it transferred around US$ 25 million through HBL. Its proprietor Lal Bahadur Gurung, whose bank account and fixed assets have been frozen, is also at large.
These cases came to light after Paris-based Financial Action Task Force (FATF), an inter-governmental organisation of G20, warned that Nepal was a risk to the international financial system as its financial regime had failed to curb money laundering and terrorism financing.
Nepal is one of the 20 countries seriously deficient in combating anti-money laundering and terrorism financing, according to FATF.
Dharma Raj Sapkota, director at NRB, who oversees the Financial Information Unit that deals with money laundering, said a money laundering case could also be filed against these firms after finding out where the money was sent and what it was being used for.